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Corruption watchdogs warn of danger to public procurement transparency


Transparency International in Ukraine and two other NGOs have addressed an open letter to Ukraine’s Prime Minister and Minister of Economic Development and Trade.  They warn that if some urgent decisions are not taken now, in two weeks there could be large-scale disruption to publication of information by tens of thousands of contractors throughout the country. This will significantly weaken anti-corruption measures and leave Ukrainians without reliable information about who their taxes are being spent.

The authors of the appeal believe the situation to have arisen because of decisions by the State enterprise Zovnishtorgvydav [Foreign Trade Publishers] which administers the official website on public procurement.

On April 10, 2014 the Verkhovna Rada adopted a new version of the Law on Public Procurement.  This contains a number of anti-corruption norms regarding openness and transparency aimed at increasing public scrutiny of government spending.

The new version was praised by World Bank and EU experts, the authors say, and note that for the first time for many years representatives of leading civic organizations were invited to take part in drawing up the bill.

The Law directly guarantees contractors the right to provide procurement information free of charge on the above-mentioned public procurement website.  This guarantee is extremely important since the new law extends the number of documents which must be made public.

They point out that contractors were able to enjoy this right unobstructed for the last 6 years.  Zovnishtorgvydav has, however, changed this and begun charging for publication. Its new rules supposedly retain free submission of procurement documents by email, but the company will only publish them after receiving paper originals. Timely publication is guaranteed only if the contractor pays an initial payment of 540 UAH, and a monthly charge from 90 to 225 UAH.

Contractors say that this is in breach of budget legislation and during a time of economic crisis the fees for many are prohibitive.

They are convinced, on the other hand, that using the supposedly free way of submitting documents will lead to the strict publication deadlines being missed, fines or personal costs.

The authors call for the rules imposed by Zovnishtorgvydav to be revoked and for contractors to have the real right to submit documents and have them published free of charge reinstated.  They suggest, if needed, to allow for the allocation of additional funding for Zovnishtorgvydav, after a proper audit has been carried out of its activities with the participation of civic activists.

They also propose that a working group of the relevant ministries, NGOs and international experts be set up to prepare and agree a plan for reforming the system of public procurement with this passed by the end of 2014.

The open appeal is signed by Oleksy Khmara from Transparency International in Ukraine; Viktor Taran from the Centre for Political Studies and Analysis, and Ivan Sikora from the Open Society Foundation. 

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